Greek Prime Minister Kyriakos Mitsotakis said on Monday (May 22) he will not seek to form a coalition government following this weekend's election, paving the way for a second vote in June he hopes his conservative party will win outright, Reuters reports.
New Democracy won 40.8% of the vote versus 20.1% for the leftist Syriza, in a stunning boost for Mitsotakis, who has had to deal with a wiretapping scandal, the COVID pandemic, a cost of living crisis and a deadly rail crash that enraged the public.
But it fell short of the number of seats needed to govern on its own, triggering a round of coalition talks among the three biggest parties.
While each party, including the Socialist PASOK, are due to receive the three-day mandate to try to form a coalition, none have enough seats to form a ruling alliance, paving the way for the appointment of a caretaker government to take the country to a new vote as early as June 25.
"I believe that no preconditions exist for the formation of a government with the current parliament... therefore I intend to return the exploratory mandate to you this afternoon, so that we can have new elections as soon as possible, " Mitsotakis told President Katerina Sakellaropoulou on Monday, after she formally offered him the opportunity to form a coalition.
Greek shares jumped on Monday and banks outperformed, gaining nearly 15%.
Greek bond prices also outperformed their peers on Monday as investors reckoned the outcome of the election was unlikely to lead to a deviation from the current fiscal discipline.
Mitsotakis has said his sights are set on the second ballot, which will take place under a system of semi-proportional representation, with a sliding scale seat bonus, increasing the chances of an outright win for his party. All parties are eligible to run again.
Syriza, the party of former prime minister Alexis Tsipras, is next in line to receive the mandate, followed by PASOK.
Once each party has returned or exhausted their three-day mandate to attempt to form a coalition, the president can then appoint a caretaker government, leading to a new election date.
Analysts have pointed to New Democracy's double-digit lead over Syriza as well as the increase in its share of votes from the 2019 election as a measure of its success.
